Economic Trends/Outlook in Syria
Thanks to a wave of economic liberalization, undertaken since the beginning of Bashar El Assad’s presidency, the economic situation of the country has massively improved, the GDP more than doubling in five years and showing a growth rate of around 4% in the recent years. The country is moving progressively from a strongly state-controlled economy to a free-market economy where privatization plays an important part. The WTO has begun accession negotiation with Damascus in May 2010 and the country presently has the status of an observer. The country launched a reform of its banking system and a beginning of the process of fiscal consolidation. The Damascus stock exchange was opened in March 2009.
But the draught the country has been exposed to since 2008 has a tendency to darken the picture and disturb the fragile economic equilibrium. Agricultural crisis has lead to a relatively significant rural exodus (20 to 30% of migrations between 2007-2008) and especially to a 27% increase in the price of cereals and bread since January 2008, thus forcing the country to import wheat for the very first time. Since 2003, an immigration wave of Iraqi refugees has also had a large impact on the Syrian economy. Syria is weakened by a very high rate of demographic growth (+3.3% annually), which means the country needs to grow by almost 7% a year in order to reach full employment. Young people are particularly hit by unemployment (75% of the unemployed are between 15 and 24 years of age).
The financial crisis had a relatively low impact on Syria, partially due to its policy of insufficiency, which means that the banking system is not very well integrated into the international banking system and also to the US sanctions. In spite of its liberalization of the key banking and insurance sectors, public companies and central government continue to concentrate more than 50% of the total amount of loans granted by the banking system in 2010. The country has trouble limiting the impact of the crisis on inflation (15% increase in 2008) and as a consequence limiting the impoverishment of a part of its population (1/3 of the population lives below the poverty line).
|GDP (billions USD)||53.91e||59.33e||68.34e||73.90e||79.96e|
|GDP (Constant Prices, Annual % Change)||6.0e||3.2e||3.0e||5.1e||5.5e|
|GDP per Capita (USD)||2,678e||2,877e||3,235e||3,415e||3,606e|
|General Government Gross Debt (in % of GDP)||31.2e||27.5e||24.3e||21.6e||20.2e|
|Inflation Rate (%)||2.8||4.4e||6.0e||5.0e||5.0e|
|Unemployment Rate (% of the Labor Force)||8.1||8.4e||-||-||-|
|Current Account (billions USD)||-2.37e||-2.39e||-2.33e||-2.54e||-|
|Current Account (in % of GDP)||-4.5e||-4.0e||-3.5e||-3.5e||-|
Source: IMF - World Economic Outlook Database
Note: (e) Estimated Data
Main Sectors of Industry
Syria, still in full economic boom, exports mostly raw materials (crude oil, cotton, cereals and phosphates). Agriculture constitutes a pillar of its economy, given its large population and its struggle to reach self-sufficiency. The agricultural sector contributes nearly 22% to GDP and employs one-third of the active population; however, it remains a fragile sector, since it directly depends on climatic conditions and especially on water scarcity, key regional factor. Cropland has increased by more than 50% since 1970, largely because of government incentives and more efficient use of irrigation methods. The principal crops include wheat, potatoes, sugar beet, and barley. Large numbers of poultry, cattle, and sheep are also raised.
Industry has a relatively important place thanks to the textile, chemical and of course oil industry, the latter representing 14% of the Syrian GDP. The hydrocarbon sector is very important for the Syrian economy and contributes up to 65% to the country’s exports. Nevertheless, the country’s oil reserves are diminishing from year to year and although the increase of barrel price enabled a growth of 4.5% between 2006 and 2007, experts expect the Syrian oil wells to dry up by 2020. The manufacturing sector contributes 25% to GDP, with the production of handicrafts such as silk, leather and glass products.
The tertiary sector is well established (mainly tourism) and contributes more than 50% to GDP.
|Breakdown of Economic Activity By Sector||Agriculture||Industry||Services|
|Employment By Sector (in % of Total Employment)||27.0||25.6||47.3|
|Value Added (in % of GDP)||21.0||33.7||45.3|
|Value Added (Annual % Change)||6.0||-2.3||4.5|
Source: World Bank - Last Available Data.
Indicator of Economic Freedom
- Mostly unfree
- World Rank:
- Regional Rank:
Sources of General Economic Information
Ministry of the Economy
Ministry of Finance
- Statistical Office
Central Bureau of Statistics
- Central Bank
Central Bank of Syria
- Stock Exchange
Website dedicated to the Syrian financial market, studies and reports on Syrian and Arab investors (in Arabic).
- Other Useful Resources
- Main Online Newspapers
Al- Thawra (in Arabic)
- Economic Portals
Library of Congress
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